Commerce Department releases Section 232 investigation report on the impact of aluminium imports

As reported by the Aluminum Association, U.S. Commerce Secretary Wilbur Ross announced the Department’s findings from the 232 investigations into the impact on national security from imports of wrought and unwrought aluminium on Feb 16, and he outlined recommendations for the president to impose tariffs or quotas on aluminium imports.

The Commerce Department found that aluminium is essential to U.S. national security, namely to satisfy Defence Department requirements for military capabilities (including armour plate for armoured vehicles, aircraft structural parts and components, naval vessels, space and missile structural components, and propellants) as well as critical infrastructure sectors (including power transmissions, transportation systems, manufacturing industries, construction, and others). The Commerce Department found that the quantities and circumstances of aluminium imports threaten to impair the national security, and the Commerce Secretary recommended the President impose either tariffs or quotas in order to get U.S. primary aluminium production up to 80% of its capacity.

The Department is recommending several options:

1.            Global Tariff: A tariff of at least 7.7% on aluminium exports from all countries.

2.            Global Quota: A worldwide quota of 86.7 per cent of their 2017 exports to the United States.

3.            Tariff on a Subset of Countries: A tariff of 23.6% on products from China, Hong Kong, Russia, Venezuela and Vietnam. All the other countries would be subject to quotas equal to 100% of their 2017 exports to the United States.

The report indicates that covered imports would include unwrought aluminium, aluminium castings and forgings, aluminium plate, sheet, strip, and foil (flat rolled products), aluminium wire, aluminium bars, rods and profiles;  aluminium tubes and pipes and aluminium tube and pipe.

President Trump has until April 19 to make a determination – to adopt one of the recommendations, modify a recommendation, or take no action. Secretary Ross did not speculate on how or when the President may act.

In the report, Secretary Ross recommended a 90-day appeal process for U.S. companies to seek an exclusion from the tariff or quota imposed. The Secretary would grant exclusions based on a demonstrated lack of sufficient U.S. production capacity of comparable products; or specific national security-based considerations.